Where one person induces another to breach a contract, the other party to that contract may have the right to claim for damages against both the person who has committed the breach of the contract and the person who induced them to do so. A company called Mainstream recently successfully sued two of its employees for breach of contract after they set up their own joint venture, with a Mr De Winter, and diverted development business away from their employer to the new business. Mr De Winter had supplied the finance for the new business. Mainstream then set about suing Mr De Winter for inducing its employees to breach their contracts with Mainstream. There was no doubt that the breach of contract could not have occurred had Mr De Winter not supplied the necessary funding. However, the House of Lords found that Mr De Winter was not to blame. Recognising the potential for a conflict of interest between the employees and Mainstream, he had sought and received assurances from the employees that there was no conflict. They had maintained that there was no conflict because Mainstream had been offered the development site but had refused it. That was not the case, but Mr De Winter was unaware of that. It was also relevant that he had supported a similar development by the employees a year earlier to which Mainstream had no objection. This case is important since it demonstrates that a claim for damages for inducing a breach of contract will only be successful where the breach is deliberate. To prove a case of breach of contract, it is necessary that there is a breach of contract, that the person procuring the breach knows they are procuring it and that the breach is an end in itself or is a means to an end. .
Content by: The Made Simple Group
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